Internalising the external costs of light and heavy goods vehicles in London

This report provides estimates of the total external costs of LGV and HGV operations in London. In 2006, total LGV and HGV activity imposed external costs of approximately £1.75-£1.8 billion using low, medium and high emission cost values. About 27 per cent of these costs were internalised by duties and taxes paid by LGV operators, compared with 26% in the case of HGVs. If congestion costs are excluded, taxes and duties paid by LGV operators are estimated to be 155% of LGVs' allocated infrastructural and environmental costs, compared with 85% in the case of HGVs. When using the medium emission cost values, LGVs accounted for 56% of these external costs in London and HGVs for 44%.